Clothing Stores NAICS 4581

Apr 16, 2025 - De Minimis Rule to End in May

• An executive order by President Donald Trump will end a trade rule provision known as de minimis that had exempted lower value goods (valued at $800 or less) from duties and tariffs for goods from China, effective May 2, according to the Wall Street Journal. Trump had suspended the provision back in February as part of his order announcing a new 10% tariff on imports from China. However, the suspension was delayed following the backup of packages at ports. The rule has become a factor as fast fashion e-commerce retailers like Shein based in China have used the exemption to ship their goods to US buyers. According to government data, the number of shipments entering the US using the exemption in the last four years increased from 637 million per year to over 1 billion per year.
• According to the Global Port Tracker report from the National Retail Federation (NRF) and Hackett Associates, import cargo at major US container ports is expected to drop dramatically at the beginning of May and fall at least 20% in the second half of 2025, year over year, due to tariff turmoil. Following tariffs on goods from China, Canada, and Mexico set earlier this year, the Trump administration has set a minimum tariff of 10% on all US trading partners and reciprocal tariffs on dozens of nations. Trump has since announced additional tariffs on China, bringing the rate on imports of Chinese goods to an estimated 145%. Jonathan Gold, NRF VP for Supply Chain and Customs Policy, said retailers are expected to pull back on imports and rely on built-up inventories for the near future, noting, “Retailers have been bringing merchandise into the country for months in attempts to mitigate against rising tariffs, but that opportunity has come to an end with the imposition of the ‘reciprocal’ tariffs.” Tracker data showed that US ports handled 2.1 million 20-foot equivalent units in March 2025, which was up 11.1% year over year.

• Clothing store retailers may want to prepare for potential changes in shopping habits created by falling consumer confidence, with levels declining 7.2 points to 92.9 in March 2025 month over month, according to the Consumer Confidence Index from the Conference Board. Stephanie Guichard, Senior Economist of Global Indicators at The Conference Board, noted that the segment driving March’s decline was consumers over 55 years old, and the decline spanned all income groups with the exception being households earning over $125,000. Per Guichard, “Consumer confidence declined for a fourth consecutive month in March, falling below the relatively narrow range that had prevailed since 2022.” Purchasing plans for homes and new cars declined while big-ticket purchases rose on a six-month moving average basis, which may reflect plans to purchase certain items before impending tariffs lead to price increases.
• According to the Wall Street Journal, trendy retailer Forever 21 filed for bankruptcy in March 2025 and plans to liquidate while looking for a buyer through a court-supervised sale process. The filing follows a string of well known retailer closures including JoAnn and Party City, which struggled in a challenging environment marked by inflation, cautious consumers, and economic uncertainty. Owned by Catalyst Brands, Forever 21 had been attempting a turnaround amid stiff competition from China-founded fast fashion retailers Shein and Temu. The bankruptcy filing, its second in six years, covers the operator of the Forever 21 stores in the US, the licensee of the brand, and some US subsidiaries. Not included in the bankruptcy are its international stores run by other licensees or its intellectual property. The retailer will close its 350-plus US stores by May 1 if it does not find a buyer, according to Retail Dive.